What Is Second Mortgage?
Second mortgages are riskier for lenders and borrowers because it comes with a higher interest rate than the first mortgages where the first mortgage gets paid first if the loan goes into default. To qualify, you need sufficient equity, acceptable credit score and the ability to repay the money. By definition, second mortgage is the second lien on a property that is used to secure a loan. It is also known as a home equity loan, a second mortgage gives borrowers flexibility to access the cash equity in their home, usually useful for other high-dollar expenses such as auto and college loans.